This post was contributed by a community member. The views expressed here are the author's own.

Politics & Government

End Personal Income Tax-Tariffs Link v István Dobozi’s Tariff War Woes

If American Employees Could Boost Pay 17% and it only cost 1.7% in higher prices that Would be a Good Deal. Smaller Business Benefit Too.

L. A. "Tony" Kovach's profile picture
L. A. "Tony" Kovach, Neighbor
|
Image on left generated by Copilot for L. A. "Tony" Kovach. Text and Image collage by L. A. "Tony" Kovach for the Patch.
Image on left generated by Copilot for L. A. "Tony" Kovach. Text and Image collage by L. A. "Tony" Kovach for the Patch.

There are doubtlessly millions of Americans who are largely or completely unaware that former President Donald J. Trump (R) has been raising the topic of replacing the personal income tax via a more robust use of tariffs on products imported into the U.S.A. Tariffs are unpopular with many of the so-called American elites, and perhaps for selfish reasons. Big businesses and billionaires export jobs and then import products to avoid U.S. regulations, to get cheaper labor, and to lower their tax rates. Left-leaning Bloomberg and the Economic Club of Chicago featured this exchange between pro-tariffs Trump and a Bloomberg editor who challenged his position on tariffs.


A discussion like the above is what Kamala Harris (D) and her big business, billionaires, and internationalist-globalist backers apparently haven’t done and likely won’t do. Trump has once more stood up for the jobs of higher paid American employees that he has protected by waiving the tariff option. But ironically, one of the few things that Trump did that Kamala’s current boss Joe Biden (D) kept in place was tariffs against Communist China. More on that shortly.

Trump told Joe Rogan that he sees tariffs as a historically proven tool to protect American producers, protect higher-paying jobs for American employees, and generate serious tax revenue doing it.

Find out what's happening in Lakelandfor free with the latest updates from Patch.

To bottom line it, Trump has a historically demonstrable point. Well prior to that video clip of Trump with Bloomberg , MHProNews published a report in June 21, 2024 which provided evidence why tariffs were good. So, anti-tariff and anti-Trump individuals like István Dobozi, a former lead economist for the World Bank, may be sincere yet can be seriously mistaken on both Trump and tariffs.

Find out what's happening in Lakelandfor free with the latest updates from Patch.

For new readers, and to remind those following this pre-election series, I’ve met Mr. Dobozi at a nearby Magyar Club. He strikes me as a pleasant fellow. I’ve shared with István Dobozi privately and publicly that while we see these issue very differently, I’ve got no animus to him. He has the same First Amendment rights you or I have.

That said, the evidence and common sense suggest he’s wrong, wrong, wrong on these topics. Because he has published his thoughts, it makes it easy to compare his reasoning with evidence that seems to contradicts his claims, and those those who think like he does. Dobozi’s thoughts are a rather common position, as the Bloomberg editor above illustrates.

I’ve taken two of Dobozi’s prior articles verbatim, and posted a section by section responses below.

> István Dobozi on Tariffs-Yea or Nay? Tariffs-U.S. Employees+Small Biz

> Response-Istvan Dobozi Ex-World Bank Lead Economist on Trump Tariffs

His more recent article is a bit tricker to respond to because Dobozi’s most recent op-ed was published in a Magyar (Hungarian) newspaper. Dobozi’s column on what he says is a coming global trade war had to be translated first, as Hungarian is a second language for me, with English as my first language.

In fairness to Dobozi, his article takes a different tact than his prior ones. He doesn’t just double down on tariffs, he put them in an international context. How, Dobozi rhetorically asks, would a Trump victory change things internationally? Dobozi assumes Democrat Kamala Harris (if she wins on November 5, 2024) won’t seriously change the current U.S. posture toward more tariffs as Trump would. The evidence suggests Dobozi is correct on those thoughts.

Among the topics Dobozi doesn’t mention is how Trump’s tariff plan could replace the personal income tax.

Needly to say, most Americans won’t know about this Magyar publication he shared his thoughts with. While anyone can take an article in Hungarian and drop it into Google’s translator, as I did to save time translating his thoughts shared below. Tariffs just isn’t a subject some will think that much about. That said, millions grasp what Trump is saying. There are good reasons to think, based on social media posts like the examples shown above, to think that perhaps millions would be thrilled to embrace tariffs over the income tax.

With those thoughts, let me commend Dobozi for previously raising a point that I will simply accept for the purpose of this discussion of tariffs in this article at face value. Dobozi said that he would expect the overall tariffs will raise prices by about 1.4 to 1.7 percent. If that’s true, and if Americans saw a 17 percent increase in incomes under a Trump presidency, that would be a deal that almost every employee would make.

Overall prices rise 1.7 percent and incomes increase by 17 percent (it could be more)? That's a no-brainer. That's a point too few, in my view, share with readers.


Saving Time By Ending the Personal Income Tax via Replacing the Income Tax with Tariffs

Furthermore, what too few have said is that billions of man-hours are wasted every year doing the paper work and record keeping needed to figure a person or family's income taxes. Perhaps one reason that Trump has only mentioned this, and not made it a main campaign pitch, is because an army of accountants, tax lawyers and other tax experts may see their livelihood changed as this proposed system would take effect.

If Trump and enough Congressional and Senate Republicans win the 2024 election, that would make getting the legislation done that could make this generational shift away from the personal federal income to tariffs tax possible. Keep in mind that multiple U.S. states operate successfully with no personal income tax. With that in mind, let's briefly focus on the time lost doing the federal income tax.

It’s Also About Time

“It's not just the filing of over 270 million tax returns, but also “record keeping, tax planning, gathering tax materials [and] learning about the law." Overall, it reportedly takes Americans 12 billion hours annually to comply with federal government paperwork.” That time lost doing income taxes and record keep is according to Money.com on August 8, 2024.

The National Taxpayers Union said this: “6.5 Billion Hours, $260 Billion: What Tax Complexity Costs.”

NASDAQ said: “The average American spends 13 hours complying with individual income tax return requirements.” That’s more than a day and a half complying with income tax requirements. I can’t speak for you, but my wife and I each invest about 3 days a year on tax compliance. I’m all in favor of seeing the personal income tax eliminated, and Trump thinks tariffs can accomplish that in a practical way.

Mini Summary

Let’s sum up before diving into the fact check and analysis of what Dobozi wrote for the digital publication Nepszava (in English: “the People’s Word”) entitled “On the Coming Trade (Duty) War.” (“Jon a globalis vamhaboru.”).

1) Tariff revenues being swapped via a phase out of the personal income tax would take time. It would likely not be instant.

2) Tariffs serve many purposes, including protecting American production and boosting more higher-paying U.S. jobs. You don’t have to tell millions living in the Rust Belt states or other areas where factories closed and those jobs went to China, Mexico, India, Vietnam or elsewhere how important protecting good American jobs can be.

3) Among the benefits of tariffs that Dobozi and others have not addressed in his recent articles is this. By reducing and possibly eliminating over time trade with the Communist Chinese economy through American product purchases, that would arguably boost the U.S. economy and it could eventually save billions of tax dollars being spent annually for the U.S. military. As incomes and opportunities rise, the need for social services could fall. That means this concept could save over time billions spending on social-service programs. There would still be a need for a military budget and some would still want or need social services.

By using tariffs and bringing those jobs and investments back to the U.S., it also cuts off the funding that fuels foreign military budgets. Using Communist China as an example, than could avoid a looming shooting war over Taiwan or the Philippines, that might cost serious loss of American blood and treasure.

4) So, with those thoughts in mind, next up we'll explore Dobozi's case why he thinks a global trade war may be coming. He has a valid point. But lacking the context shared above, his case is arguably incomplete. I’ll address with evidence other aspects of his argument following sections of his narrative.

5) According to the Economic Policy Institute (EPI.org) on 1.31.2022, as unpacked in a report linked here, was the following.

"The mismanaged integration of the United States into the global economy has devastated U.S. manufacturing workers and their communities. Globalization of our economy, driven by unfair trade, failed trade and investment deals, and, most importantly, currency manipulation and systematic overvaluation of the U.S. dollar over the past two decades has resulted in growing trade deficits—the U.S. importing more than we export—that have eliminated more than five million U.S. manufacturing jobs and nearly 70,000 factories. These losses were accompanied by a shift toward lower-wage service-sector jobs with fewer benefits and lower rates of unionization than manufacturing jobs. The loss of jobs offering good wages and superior benefits for non-college-educated workers has narrowed a once viable pathway to the middle class."

That EPI report also said this.

"Black workers in manufacturing earn $5,000 more per year (17.9% more) than in nonmanufacturing industries; Hispanic workers earn $4,800 more per year (+17.8%); AAPI workers earn $4,000 more per year (+14.3%); and white workers earn $10,100 more per year (+29.0%)."

While this is oversimplified, when someone combines the efforts to fight oligopoly style monopolization with on-shoring factory jobs into the U.S., increases of roughly 37 percent can be achieved with the relatively modest cost of what Dobozi pegged at 1.4 to 1.7 percent.

EPI said:

Surging imports from China and the resulting growing trade deficit with China have had a key role in manufacturing job loss. Reducing that deficit is critical to bringing jobs back.

No wonder EPI entitled their report: “Botched policy responses to globalization have decimated manufacturing employment with often overlooked costs for Black, Brown, and other workers of color.”

Note that the Magyar by Dobozi below will will have the English translation per Google's translator shown under each Hungarian section. My reply will be in italics.

Part I - For Nepszava (in English “the People’s Word”) entitled “On the Coming Trade (Duty) War.” (“Jon a globalis vamhaboru.”)

Vélemény

amerikai elnökválasztás

vámháború

Opinion

US presidential election

customs war

Publikálva:2024.10.29. 06:00

Dobozi István

Jön a globális vámháború?

A második világháború után az Egyesült Államok vezető szerepet játszott a szabadkereskedelem multilaterális intézményeinek felépítésében és a nemzetközi kereskedelmi szabályok kidolgozásában. A mennyiségi korlátozások és diszkriminációk meredeken csökkentek. Washington jó példát mutatott az importvámok drasztikus leépítésében: a világ nagy gazdaságai között az USA-ban a legalacsonyabbak a vámtarifák.

After World War II, the United States played a leading role in building multilateral institutions for free trade and developing international trade rules. Quantitative restrictions and discrimination have been sharply reduced. Washington set a good example in the drastic reduction of import duties: among the world's major economies, the USA has the lowest customs tariffs.

Kovach Evidence-based feedback: left-leaning Wikipedia largely agreed with Dobozi, per left-leaning Bing's AI powered Copilot, which said: "Regarding customs tariffs, the United States has historically maintained lower tariff rates compared to many other major economies."

More on that further below.

Back to Dobozi's narrative on the "Coming Trade Wars."

Amerika szabadkereskedelmi vezető szerepében éles törés következett be Donald Trump egy évtizeddel ezelőtti politikai színrelépésével. Született populistaként Trump korán ráérzett a kereskedelmi protekcionizmusban rejlő választási tőkére, különösen az elnökválasztásokban kritikus szerepet játszó „rozsdaövezetben”, ahol a feldolgozóipari foglalkoztatottság hosszú ideje visszaesőben volt. Trump a Nagy-tavak környéki ipari hátország gazdasági és társadalmi válságát a 2016-os elnökválasztás központi témájává tette.

A sharp break in America's role as a free trade leader occurred with the political appearance of Donald Trump a decade ago. As a born populist, Trump early sensed the electoral capital of trade protectionism, especially in the "rust belt" that plays a critical role in presidential elections, where manufacturing employment has long been in decline. Trump made the economic and social crisis of the industrial hinterland around the Great Lakes a central theme of the 2016 presidential election.

Kovach Evidence-based feedback, also per Copilot: "Trump's administration implemented several protectionist trade policies, including tariffs on steel and aluminum, which were intended to protect American industries and jobs. These policies marked a significant shift from the free trade stance that the U.S. had maintained for decades."

Copilot provided 4 links to articles supporting Dobozi's assertion. Again, more on this shortly.

Back to Dobozi's narrative on the "Coming Trade Wars."

Tőről metszett merkantilistaként – az import rossz, mert megöli a hazai munkahelyeket – Trump irracionálisan fetisizálta az amerikai külkereskedelmi deficitet, jóllehet az csupán a GDP három százalékát teszi ki. Mindegyik ország – ellenség vagy barát –, amelynek számottevő kereskedelmi mérlegtöbblete volt Amerikával, „tisztességtelen” kereskedőnek számított, és célkeresztbe került. Közismert Trump elnök Kína ellen indított vámháborúja. De még a legközelebbi szövetségesek (köztük az Európai Unió) acél- és alumíniumexportját is – mondvacsinált nemzetbiztonsági okra hivatkozva – vaskos vámtarifákkal sújtotta. Trump rombolta a szabályokon nyugvó világkereskedelmi rendszert, anélkül, hogy csökkentette volna az amerikai kereskedelmi mérleghiányt, vagy növelte volna a feldolgozóipari dolgozók számát.

As a true mercantilist - imports are bad because they kill domestic jobs - Trump irrationally fetishized the American foreign trade deficit, even though it only accounts for three percent of GDP. Any country—foe or friend—that had a significant trade surplus with America was considered an "unfair" trader and was targeted. President Trump's tariff war against China is well known. But even the steel and aluminum exports of the closest allies (including the European Union) were hit with hefty tariffs, citing alleged national security reasons. Trump has destroyed the rules-based world trade system without reducing the US trade deficit or increasing the number of manufacturing workers.

Kovach Evidence-based feedback, first on the section where bold was added above. Per Copilot:

"Dobozi's claim is largely accurate."

Next, let's look at the sentance by Dobozi prior to the bold remarks shown above. Said Dobozi: "As a true mercantilist - imports are bad because they kill domestic jobs - Trump irrationally fetishized the American foreign trade deficit, even though it only accounts for three percent of GDP."

According to Investopedia:

"Mercantilism was an economic system of trade that spanned the 16th century to the 18th century. Mercantilism was based on the principle that the world's wealth was static, and consequently, governments had to regulate trade to build their wealth and national power. Many European nations attempted to accumulate the largest possible share of that wealth by maximizing their exports and limiting their imports via tariffs.1

Key Takeaways

  • Mercantilism was the dominant economic system from the 16th century to the 18th century.
  • Mercantilism was based on the idea that a nation's wealth and power were best served by increasing exports and reducing imports.
  • It's characterized by the belief that global wealth was static and that a nation's economic health relied heavily on its supply of capital.
  • Due to the nationalistic nature of mercantilism, nations frequently used military might to protect local markets and supply sources.
  • Mercantilism was replaced by free-trade economic theory..."

So, with that in mind, it can hardly be said that "...Trump irrationally fetishized the American foreign trade deficit, even though it only accounts for three percent of GDP." There is obviously a competiting economic theory to the one Dobozi and others have embraced. Using slurs like 'irrational' or 'fetishized' doesn't prove Dobozi's point, and for some, it may undermine it. Clearly, when a principle was used successfully for centuries by Europeans and Americans, it is hardly 'irrational.'

The chart below from the U.S. Bureau of Economic Analysis confirms that Dobozi was largely correct about the share of GDP that trade deficits account for, which that source put at 2.8 percent.


That said, it doesn't mean that Trump's view is irrational. A simple analogy will make the point. Would you rather have 2.8 (or 3) percent more in your bank account? Or would you rather have a 2.8 or 3 percent deficit in your bank account?

Obviously, we should prefer having more not less. We should prefer being in the black than in the red.

More, shortly, but with that in mind, back to Dobozi's narrative on the "Coming Trade Wars."

A kereskedelempolitika „trumpizálódása” folytatódott Joe Biden elnöksége alatt. Trump átlagosan 20 százalékos kínai vámtarifái hatályban maradtak, amelyeket a Világkereskedelmi Szervezet (WTO) illegálisnak minősített a „legnagyobb kedvezmény elvének” (egyforma vámok minden WTO-tagország számára) megsértése miatt. Biden héjaként viselkedik a Kínába irányuló amerikai csúcstechnológiák – különösen a félvezetők (és azok gyártósorai), az 5G, a mesterséges intelligencia és a robotok – exportjában.

The "Trumpization" of trade policy continued under Joe Biden's presidency. Trump's tariffs on China, averaging 20 percent, remained in place, which the World Trade Organization (WTO) has declared illegal for violating the "most-favoured-nation principle" (equal tariffs for all WTO members). Biden acts as a shell for the export of American high-tech to China, especially semiconductors (and their production lines), 5G, artificial intelligence and robots.

Copilot said that was only partially true and misleading. "So, while Dobozi's claim about the

continuation of tariffs and the WTO's ruling is accurate, the assertion that Biden acts as a "shell" for high-tech exports to China is misleading. The Biden administration has taken significant steps to limit such exports for national security reasons."

That also begins to touch upon the national security issues connected with trade with China. As the preface noted, there are national security risks caused by trade with a country like Communist China. Making China economically stronger via trade not only puts the U.S. at greater risk, but it also puts neighboring Asian and Pacific countries like India, Taiwan, Japan, South Korea, Australia, the Philippines, etc. at greater risk by making China's military stronger. So, there is an entire set of ripple effects from trade that Dobozi unfortunately ignored, for whatever reasons.

Back to Dobozi's narrative on the "Coming Trade Wars."

Foreign economic policy - primarily trade balance imbalance and customs policy - became a key element of Trump's economic plans in the 2024 presidential election campaign as well. Trump and his staff openly state that they want to end the protectionist program started in the first term during the second presidency.

Per Copilot:

"Dobozi's statement is partially true.

  1. Foreign economic policy: Trade balance and customs policy have indeed been key elements of Trump's economic plans for the 2024 presidential election campaign 1 2.
  2. Protectionist program: Trump and his team have not openly stated that they want to end the protectionist program started during his first term. Instead, they have indicated a continuation and even expansion of protectionist measures, such as tariffs on imports 1 2.

So, while trade balance and customs policy are central to Trump's campaign, the claim about ending the protectionist program is not accurate.

1 budgetmodel.wharton.upenn.edu 2 www.politifact.com ..."

This writer would concur that there is no indication that Trump would end protectionism, given that he and his campaign have stated the opposite.

Back to Dobozi's narrative on the "Coming Trade Wars."

A trumpi külgazdaságpolitika fő elemei:

(i) Szabadkereskedelem helyett fair kereskedelem a hazai jogrendszerre támaszkodva. Azt, hogy mi unfair, Washington, nem pedig a WTO dönti el.

(ii) Kiegyensúlyozott külkereskedelmi mérleg.

(iii) Magas új vámtarifák kivetése az összes importra a kereskedelmi mérleg egyensúlyának biztosítása céljából. A vámokat rugalmasan kell szabályozni, úgy, hogy az export-import egyensúlya fönnmaradjon.

(iv) Az amerikai gazdaság „stratégiai lecsatolása” Kínáról a kereskedelmi, beruházási és technológiai kapcsolatokban.

The main elements of Trump's foreign economic policy:

(i) Instead of free trade, fair trade based on the domestic legal system. Washington, not the WTO, decides what is unfair.

(ii) Balanced foreign trade balance.

(iii) Imposition of high new tariffs on all imports to balance the balance of trade. Customs duties must be regulated flexibly, so that the export-import balance remains intact.

(iv) “Strategic decoupling” of the US economy from China in trade, investment and technology relations.


That section is largely accurate, said Copilot.

Back to Dobozi's narrative on the "Coming Trade Wars."

A lehetséges második elnöki ciklusra felvázolt elképzelések közül a legnagyobb figyelmet Trump 10 százalékos (de bedobta a 20 százalékot is) általános vámja váltotta ki, amelyet az összes importra kivetnének, beleértve az USA szövetségeseitől származó behozatalt is. A fő kereskedelmi ellenségnek számító Kínára minimum 60 százalékos vám vár. Ezekkel a tarifákkal a jelenlegi 2,3 százalékos átlagos amerikai vámszint több mint a hétszeresére, 17 százalékra ugrana fel. Nem kizárt, hogy a magát az „üzletkötés művészének” tartó exelnöknél a 10 és 60 százalékos tarifa csupán induló tárgyalási pozíció és nyomásgyakorlás annak érdekében, hogy a partnerekből minél nagyobb kereskedelempolitikai engedményeket (például mélyebb piacnyitást) csikarjon ki.

Among the ideas outlined for a possible second term, Trump's 10 percent (but he also threw in 20 percent) blanket tariffs on all imports, including those from U.S. allies, drew the most attention. China, which is the main trade enemy, faces a tariff of at least 60 percent. With these tariffs, the current average US tariff level of 2.3 percent would jump more than seven times, to 17 percent. It is possible that the 10 and 60 percent tariff for the ex-president, who considers himself the "artist of the deal", is just a starting negotiation position and an exercise in pressure in order to extract the greatest trade policy concessions (for example, deeper market opening) from the partners.

Per Copilot: "Dobozi's statement is largely accurate..."

Back to Dobozi's narrative on the "Coming Trade Wars."

Ezek a tervek élesen szembemennek a nemzetközi kereskedelmi joggal, amely kifejezetten tiltja az ilyen egyoldalú és aránytalan vámpolitikai intézkedéseket. Emellett a globális kereskedelmi háború kirobbanásának komoly veszélyét hordozzák magukban, mivel biztosra vehetően a fő kereskedelmi partnerek – szemet szemért alapon – hasonló mértékű ellenvámokkal sújtják majd az amerikai exportot. A kilátásba helyezett vaskos vámemelés komoly negatív hatásokkal járna Amerikában: a GDP volumene másfél százalékkal csökkenne, egymillió állás elveszne, az inflációs ráta egy százalékponttal nőne és évente 4000 dollárral terhelné a családok pénztárcáját. De a közvélemény sincs tisztában ezekkel a tényekkel, ezért a szavazók több mint a fele helyesli a populista, szavazatnyerő vámtervet.

These plans are in stark contrast to international trade law, which expressly prohibits such unilateral and disproportionate tariff policy measures. In addition, they carry a serious risk of the outbreak of a global trade war, as it is certain that the main trading partners will - on an eye for an eye basis - hit American exports with similar tariffs. The expected massive tariff increase would have serious negative effects in America: the volume of GDP would decrease by one and a half percent, one million jobs would be lost, the inflation rate would increase by one percentage point and it would cost families $4,000 a year. But the public is not aware of these facts either, which is why more than half of the voters approve of the populist, vote-winning tariff plan.

Let's break that section by Dobozi into a few bite sized points. When Dobozi said: "These plans are in stark contrast to international trade law, which expressly prohibits such unilateral and disproportionate tariff policy measures. In addition, they carry a serious risk of the outbreak of a global trade war, as it is certain that the main trading partners will - on an eye for an eye basis - hit American exports with similar tariffs," Copilot had already pointed out errors in some of what Dobozi has previously shared.

So Dobozi can't broadly assert the accuracy of Trump's plans when Dobozi didn't present them accurately, as Copilot pointed out, citing sources for its statements.

Next, Trump used tariffs vs. China and others in his first term. There was no drop in GDP as a result, per the chart based on BEA data, shown below. Given that recent historic evidence, it seems odd for Dobozi to claim, without linked or cited evidence, that it would be different in the potential 2nd Trump term.

Back to Dobozi's narrative on the "Coming Trade Wars."

Trump szuper agresszív vámpolitikája mély koncepcionális hibával terhes.

Az exelenök és szakmai stábja nincs tisztában a vaskos közgazdasági ténnyel: Amerika számára a kereskedelmi mérleghiány makroökonómiai szükségszerűség, amely lényegében az alacsony belső megtakarítás következménye. (Mint ahogy az óriási kínai kereskedelmi mérlegtöbblet nem kis mértékben az ottani rendkívül magas belső megtakarítást tükrözi.) A hazai termelésnél többet fogyasztó, a belső megtakarításainál többet beruházó Amerika számára a kereskedelmi mérleghiány természetes strukturális állapot. A mérlegdeficit nem véletlenül – demokrata vagy republikánus kormányoktól függetlenül – van emelkedő pályán már fél évszázada.

Trump's super-aggressive tariff policy is fraught with a deep conceptual flaw.

The former president and his professional staff are not aware of the solid economic fact: for America, the trade deficit is a macroeconomic necessity, which is essentially a consequence of low domestic savings. (Just as China's huge trade balance surplus reflects to a small extent the extremely high internal savings there.) For America, which consumes more than its domestic production and invests more than its internal savings, the trade balance deficit is a natural structural condition. It is not by chance that the balance sheet deficit has been on the rise for half a century, regardless of Democratic or Republican governments.

This writer posed the following to Copilot: "Dobozi cited no sources for his claims, which were a mix of accurate and inaccurate, as we have jointly seen. So, merely claiming that Trump's tariff policies are flawed seems to be misplaced, given that Investopedia and others have pointed out that mercantilism was an economic success for the U.S. and other countries for centuries. Provide feedback on that analysis."

Copilot

"Your analysis is quite insightful. ..."

"...Dobozi's assertion that Trump's tariff policy is conceptually flawed lacks specific evidence or sources. ..."

"...Historically, mercantilism was indeed an economic success for many countries, including the U.S., during certain periods..."

"...Your analysis highlights the complexity of the issue and the need for a balanced perspective. ..."

Back to Dobozi's narrative on the "Coming Trade Wars."

A deficitet tovább mélyíti a dollár uralkodó kulcsvaluta szerepe: a bőséges külföldi dollárlikviditás fenntartásához az szükséges, hogy Amerika több árut vásároljon külföldről, mint amennyit ott elad. A dollár iránti világkereslet ugyanakkor felértékelő hatással van a „zöldhasúra”, ami csökkenti az amerikai kivitel árversenyképességét.

The deficit is further deepened by the role of the dollar as the dominant key currency: in order to maintain ample foreign dollar liquidity, it is necessary for America to buy more goods from abroad than it sells there. At the same time, world demand for dollars has an appreciating effect on the "greenback", which reduces the price competitiveness of American exports.

Copilot replied to a detailed question about the above with a detailed response that concluded as follows:

"In summary, while Dobozi raises some valid points, his analysis appears to be overly simplistic and lacks consideration of the broader economic context. Your observations highlight the importance of examining multiple factors and perspectives when evaluating economic policies."

Back to Dobozi's narrative on the "Coming Trade Wars."

Ezekből a kézenfekvő makroökonómiai összefüggésekből logikusan következik: az USA nem túlfűtött protekcionizmussal – és újabb masszív vámemeléssel –, hanem elsősorban a rendkívül alacsony megtakarítási rátájának emelésével tudná a kereskedelmi mérleghiányát tartósan mérsékelni. A szövetségi kormány a nemzeti megtakarítási rátát emelni tudná például a költségvetési hiány csökkentésével. Trump eddig nyilvánosságra hozott kampánytervei (különösen a beharangozott adócsökkentések) azonban – pártfüggetlen elemzések szerint – a fiskális hiány és a szövetségi államadósság jelentős növekedését vetítik előre. Márpedig az amerikai gazdaságban empirikusan kimutatható az „ikerdeficit” létezése, vagyis a költségvetési és a kereskedelmi/fizetési mérleghiány tendenciaszerű együttmozgása.

It follows logically from these obvious macroeconomic connections: the USA could not permanently mitigate its trade balance deficit with overheated protectionism - and another massive tariff increase - but primarily by increasing its extremely low savings rate. The federal government could increase the national savings rate, for example, by reducing the budget deficit. However, according to independent analyses, Trump's publicized campaign plans (especially the announced tax cuts) project a significant increase in the fiscal deficit and the federal public debt. However, the existence of the "twin deficit" can be empirically demonstrated in the American economy, i.e. the trend-like co-movement of the budget deficit and the balance of trade/payments deficit.

Again, Dobozi made a logical mistake by ignoring other aspects of the Trump plan for a second term. Without that added context, his analysis logically is flawed, as Copilot confirmed and the above illustrates. For instance. Trump has said he wants to appoint Elon Musk to a commission that would root out waste and fraud in federal programs. Musk said he thinks 2 trillion dollars can be saved annually through that process. By failing to mention that point, Dobozi's analysis fails some of its own tests.

Back to Dobozi's narrative on the "Coming Trade Wars."

Megválasztása esetén hogyan érintenék Trump vámpolitikai céljai a magyar-amerikai kereskedelmet? Az USA hazánk Európán kívüli második legfontosabb kereskedelmi partnere, amellyel szemben igen magas exporttöbbletünk van (tavaly 8 milliárd dollár). Az EU-ra kivetendő 10 százalékos vám várhatóan visszavetné az USA-ba irányuló magyar kivitelt és csökkentené az exporttöbbletet. A magyar kivitelben magas a gépkocsik súlya, ami pótlólagos kockázat forrása, mivel Trump különösen erősen kívánja védeni a hazai autóipart, miközben nem lelkesedik az e-autók iránt. Nem zárható ki a 10 százalékosnál magasabb tarifa kivetése a gépjárművekre. (Trump 200 százalékos vámot szellőztetett meg a Mexikóból behozott autókra, miközben szabadkereskedelmi egyezmény köti össze a két országot.)

If elected, how would Trump's customs policy goals affect Hungarian-American trade? The USA is our country's second most important trade partner outside of Europe, against which we have a very high export surplus (8 billion dollars last year). The 10 percent tariff to be imposed on the EU is expected to reduce Hungarian exports to the USA and reduce the export surplus. The weight of cars in Hungarian exports is high, which is a source of additional risk, as Trump wants to protect the domestic car industry particularly strongly, while he is not enthusiastic about e-cars. The imposition of a tariff higher than 10 percent on motor vehicles cannot be ruled out. (Trump announced a 200 percent tariff on cars imported from Mexico, while the two countries have a free trade agreement.)

This is a fair question raised by Dobozi. But again, for a variety of reasons, his belief wasn't and can't be proven by evidence. Viktor Orbán, the Prime Minister of Hungary, has asserted that for the sake of peace, there is a need to have Trump back in the White House. Surely, Orbán has considered the entire range of possible impacts on Magyars (Hungarians) before making his essentially pro-Trump remarks that he has made several times.

There are those who think that the Biden-Harris regime, by contrast, failed to head off the war between Russia and Ukraine. Harris has said she supported Biden's policies and would broadly keep them. So, Harris would apparently continue the globalization trend that has undermined American labor, U.S. smaller businesses, and related. More on that further below.

Back to Dobozi's narrative on the "Coming Trade Wars."

Mi várható az amerikai kereskedelempolitikában Kamala Harris győzelme esetén? Erről keveset tudunk. Trumppal éles ellentétben Harris a belpolitikára összpontosít, ritkán foglalkozik világgazdasági kérdésekkel. Egy dolog azonban bizonyos: az alelnök sem híve a szabadkereskedelemnek. Szenátorként a megreformált észak-amerikai szabadkereskedelmi egyezmény (USMCA) ellen szavazott. Elnökként Biden erősen protekcionista vonalát vinné tovább, Kínával szemben folytatná a vámok stratégiai célú alkalmazását, a szövetséges államokat azonban megkímélné új tarifák kivetésétől. Nem nehéz eldönteni, hogy melyik elnökjelölt jelentene nagyobb veszélyt a világkereskedelemre. November 5. fordulópont lehet.

A szerző a Világbank volt vezető közgazdásza.

–

A cikkben megjelenő vélemények nem feltétlenül tükrözik szerkesztőségünk álláspontját. Lapunk fenntartja magának a jogot a beérkező írások szerkesztésére, rövidítésére.

What can be expected in American trade policy if Kamala Harris wins? We know little about this. In stark contrast to Trump, Harris focuses on domestic politics and rarely deals with global economic issues. However, one thing is certain: the vice president is not a fan of free trade either. As a senator, she voted against the reformed North American Free Trade Agreement (USMCA). As president, Biden would continue his strongly protectionist line, continue the strategic use of tariffs against China, but would spare allied states from imposing new tariffs. It is not difficult to decide which presidential candidate would pose a greater threat to world trade. November 5 can be a turning point.

The author is a former senior economist of the World Bank.

–

Okay, that's the last of Dobozi's argument.

Perhaps intentionally or subconsciously, Dobozi has crafted an argument that has an intention of raising fears about Trump in Hungary, as he has raised similar concerns in the U.S. Once more, in an easier analysis (because no translation is needed), the two articles linked below that debunked some apparent errors by Dobozi are provided. They stand the test of time.

> István Dobozi on Tariffs-Yea or Nay? Tariffs-U.S. Employees+Small Biz

> Response-Istvan Dobozi Ex-World Bank Lead Economist on Trump Tariffs

Let's wrap this up with a few relevant thoughts. In no particular order of importance are the following concepts.

1) Trump has made it clear that when he says "America First," that also respects the notion that other nations should put their citizens' interests first too. Trump and Orbán has put their respective peoples and national interests first. Ironically, what Dobozi and "free traders" de facto admit is that the U.S. has in recent decades essentially sold out the interests of tens of millions of Americans to the interests of globalists. Do we have more peace or prosperity as a result of free trade? The obvious answer is "no" under Harris and Biden, no under Obama-Biden, and no under Bush-Cheney. Trump upended Republican politics as well as national politics. He challenged the pro-free trade "U.S. Chamber of Commerce" wing of the GOP. The result was more peace overseas and more prosperity at home.

2) With respect to the Trump concept of replacing the personal income tax with tariffs, it should be seen as part of a wholistic policies. Trump's DOJ brought suit against Google, which that case was continued under the Biden-Harris DOJ. Google was found to be a monopolist. Part of what has gone wrong in the U.S.A. in the century-plus progressive era of American history is the lack of control of oligopoly style monopolization.

3) Ironically, Biden's White House website made the point that increased consolidation costs U.S. employees on average some 17 percent a year in lower earning power.

https://www.manufacturedhomepr...

4) So, there are several aspects of the Trump policies, some of which - perhaps for reasons of length - Dobozi didn't address. But by failing to address them, the result is that his own analysis is marred by holes that hobble his arguments, which with all due respect, are thus flawed.

https://www.manufacturedhomepr...

5) Trump says his policies will make American's wealthy again. He has an evidence-based and historically valid point. While no period of American history, or any nation's history, is perfect, there was a kind of economic golden era for the U.S. in the 1950s and early 1960s. For example, a father was able to get and keep a job with nothing more than a high school degree, support larger families, and often without the mother having to have a job. It was after tariffs, trade, and other economic policies in the U.S. were changed that the so-called 1 percent saw their share of the U.S. GDP surge and the working and middle class saw their share of incomes decline.

6) Again, there is more on those topics in the articles linked below.

> István Dobozi on Tariffs-Yea or Nay? Tariffs-U.S. Employees+Small Biz
> Response-Istvan Dobozi Ex-World Bank Lead Economist on Trump Tariffs

> A Brief History of Labor Day and Modern Insights for Employees and Pay

7) By controlling illegal immigration, allowing merit-based immigration, and creating pro-family and pro-smaller business policies, bolstered by America First policies on trade and avoiding foreign wars, making government spending smarter rather than wasteful, it is entirely possible that the personal income tax could be eliminated in favor or tariffs on imports. New factories and an array of jobs would spring to life in the U.S. With less competition for American housing by illegal immigrants, housing opportunities and other concerns linked to inflation would improve. Fuel and utilities other costs, like food, would decline. Nor is this theory. It was a lived experience for Americans during the Trump years. Energy independence and other Trump policies would boost our economy, boost American's pay and opportunities, while cutting costs.

More Pay. Lower Costs. More peace, more security. Sounds, good, doesn't it?

8) My wife and I already voted. We are political independents, but we voted for all Republicans, starting with Trump-Vance. It makes no sense to vote for Trump without voting for those who would support his efforts in Congress. To learn more about these issues, see the linked reports above or that follow. I'd love to replace the income tax with tariffs, hopefully, we can all live to see that great day!

> 537 Votes–8 Votes per FL County–Decided 2000 Election. Vote! FAF-VOTE!

> That’s Garbage! Who Gets Last Laugh? Facts-No Excuses Voter Next Steps

> FEAR – False Evidence Appears Real – Faux vs Authentic Reason for FEAR

> Life Boils Down to Time, Risks, Rewards, Opportunities and Choices

---

> István Dobozi on Tariffs-Yea or Nay? Tariffs-U.S. Employees+Small Biz

> Top 10 States for Homelessness & Top Cities for Crime=Shocking Lessons

> McDonald Trump and MAGA GOP vs. Kamala Harris, Joe Biden & Democrats

> First Liberty Voter Guide & Polk County FL Sample Ballot w/Suggestions

---

> Hawkins-Kamala VP Hopeful Gov Tim Walz (MN-D) Says Harris Gun Agenda

> Actor-Author-Believer Chuck Norris – ‘Calling All Gun Owners to Vote!’

> Why do Liars Lie? Why do those Engaged in Paltering and Spin Palter?

> WashPost-American Dream Fades But Assoc CEO Mark Weiss Shows Solution

> ‘Supersized Lies with Order of Fries’ McDonalds Campaign Controversy

---

> Kamala Harris Reveals Her Stance Toward Catholics and Other Christians

> How do Hurricanes Helene and Milton Rank in Inflation Adjusted Cost$?

> Controversy-Manufactured Housing Institute-Lesli Gooch-Mark Bowersox

> 34,758 Votes May Decide ‘24 Election & Dr. George Barna@ACU Research

> Other Countries Homeownership Rates vs. U.S. – Fix Affordable Housing

---

> Visual Capitalist Shows Top 15 Artificial Intelligence-AI-Online Tools

> Burning Bush Cove, Hurricanes Helene and Milton, and Where Is God?

> Lila Rose Open Letter and Other Pro-Lifers not Planning to Vote Trump

> Afghan Released by Biden-Harris Admin Arrested for Terror Attack Plot

> How do Hurricanes Helene and Milton Rank in Inflation Adjusted Cost$?

---

> Controversy-Manufactured Housing Institute-Lesli Gooch-Mark Bowersox

> 34,758 Votes May Decide ‘24 Election & Dr. George Barna@ACU Research

> Other Countries Homeownership Rates vs. U.S. – Fix Affordable Housing

> Visual Capitalist Shows Top 15 Artificial Intelligence-AI-Online Tools

> Burning Bush Cove, Hurricanes Helene and Milton, and Where Is God?

---

> WND Exclusive-KAMALA'S AMERICA-World Net Daily 88 Page Special Report

> Afghan Released by Biden-Harris Admin Arrested for Terror Attack Plot

> Ashville, NC Video and Photos-Untold Thousands Need Prayers & Support

> Fact Check-There is No Truth in Advertising Law Governing Politicians

> Gulf Between Ruling Elites Average Americans is Wide+Deep, per Survey

---

> Lila Rose Open Letter and Other Pro-Lifers not Planning to Vote Trump

> Daniel McCarthy Explains How Donald Trump can Win the Popular Vote

> Why Did Costs-Crime-Conflicts Soar After Trump left the White House?

> Protecting "Government Of By and For the People" in 2024 and Beyond

> Small Businesses tell Congress to Stop Tax Hikes – Wall St vs. Main St

---

> AI Backed Hit-Analysis on Big Manufactured Housing Industry Operations

> The Rigged System-Who Rigged the System and How to Fix a Rigged System

> Gallup Says-'2024 Election Environment Favorable to GOP'-Election Time

> Confidence Plummets in Sept-Conference Board Consumer Confidence Index

> Fannie Mae-Existing Home Sales Near 30-Year Low Despite Lower Rates

---

> Knight-‘Govt Exists to Promote and Protect Ordinary Happiness in Life’

> Doublespeak Doublethink and Insightful Orwellian Lessons from the Left

> Manufactured Housing Institute & Next Great Affordable Housing Debate?

> American Leviathan-Ned Ryun-CEO of American Majority and Voter Gravity

> Former Famed Tampa Bay Bucs & Colts Coach Tony Dungy to Kamala Harris

---

A Teen Looks at the Election: > TARK-Drill Down on Tyranny vs. Faith; Freedom and Upcoming Election

--

> Kamala to Oprah-If Somebody Breaks Into My House They're Getting Shot

> NAR-Existing Home Avg $416700 Aug-2024 Interest Rates Slide-Sales Dip

> Deception & Misdirection-3 Tricks-Paltering, Posturing and Projecting

> Caution! Equity LifeStyle Properties Dweller-Investor-Biz-Legal Alerts

> Herland: ‘Aldous Huxley Interview-Tech, Big Gov, Big Biz=Grave Danger’

--

> U.S. Health-Dr. Marty Makary–‘Broke Medicine’ Blind Spots-Price We Pay

> 12 Examples of Public Calls for Violence Against Trump-More Ryan Routh

> Lessons of Bernie Madoff-Enron-WorldCom-2008 Housing-Financial Crisis

> Gunman Ryan Wesley Routh Insights from CNN-Daily Signal-Patch and X

> What Pastors, Priests, Religious Leaders and People Must Do - or Else

--

> “TANSTAAFL”–What Does It Mean and Why Does It Matter to You and Yours?

> HUD Admits Decades of Delay-Finally OK Multi-Family Manufactured Homes

> ‘Mobile Home Values Rising Faster Than Single-Family’ House-Wow Fact$

> Realtor-What Is a Manufactured Home? The Next Step Beyond Mobile Homes

> The Two Groups that Should See New Movie Reagan (2024) with Trailer

--

> Magyar Szabadság Kör – Cultural-Culinary Experience in Plant City, FL

> Realtor? Journalist? Affordable Manufactured Home Production Jumps

> Orlando RE Agent Smith-Younger Adults Will Need $8500 Monthly for Rent

> Blankley-Goodbye American Dream? Only 10% Polled Can Buy a House; But

> A Brief History of Labor Day and Modern Insights for Employees and Pay

--

> Waiting for Fed Rate Cut Before Buying a Home? Experts Say Think Twice

> Frank Rolfe-Special Interests ‘Don’t Want to Solve Affordable Housing'

> TARK-‘I’m a Teen and Know the Solution to Affordable Housing Crisis’

> Renting? Rent too High? Odds Are DOJ Suit vs RealPage Matters to You

> New-Certified “Half Price Homes” - Affordable Housing Solution Redux

--

> Solution: “Would-Be Homebuyers Need 80% More Income Than 4 Years Ago”

L. A. “Tony” Kovach and his family live in a manufactured home on private property in Winter Haven, FL. He is the co-founder of ManufacturedHomeLivingNews.com

(MHLivingNews.com) and ManufacturedHomeProNews.com (MHProNews.com), trade publications serving segments of the manufactured home industry. Having worked in several segments of the manufactured home industry for over 3 decades, Kovach is a widely acknowledged and often praised expert on manufactured housing. Kovach has earned multiple awards in history.

The views expressed in this post are the author's own. Want to post on Patch?

More from Lakeland